TIOL-DDT 954 · the untouched capture
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 954</font><br>
18.09.2008<br>
Thursday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tariff Value of Brass Scrap and Poppy seeds reduced</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government has reduced the Tariff Value of Brass Scrap from 4295 US Dollars to 4216 and the Tariff Value of Poppy Seeds from 6898 Dollars to 6844 Dollars. There is no change in the Tariff Values of other items.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2008/cnt08_107.htm" target="_blank">Notification No. 107/2008- Cus., (N.T), Dated: September 16, 2008</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Export of Rice – DGFT changes policy</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government has again amended the export policy relating to Rice as follows.</font></p>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>I. Non Basmati Rice: </strong> Export of PUSA -1121 variety of Non-basmati rice shall be allowed subject to the following conditions:</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Grain of rice to be exported shall be more than 7 mm of length and ratio of length to breadth of the grain shall be more than 4; [<font color="#FF6633">Do they have equipments to measure the length and breadth of rice in the Customs?</font>]</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Export allowed subject to registration of contracts with APED, New Delhi, prior to shipment; </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Export permitted only if the minimum FOB price is US$ 1200 per ton or Rs. 48,000/- per ton;</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Export will be restricted through the following ports only:- Kandla, Kakinada, Kolkata, JNPT, Mumbai, Mundra, and Pipavav</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Export shall be allowed with immediate effect, out of paddy procured in KMS 2008-09.</font></p>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>II. Rice of seed quality: </strong>Subject to conditions imposed vide Notification No. 32 dated 19th August, 2008.</font> </p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>II. Basmati Rice including (Dehusked (Brown), semi-milled, milled both in either par-boiled or raw condition): </strong></font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Grain of rice to be exported shall be more than 7 mm of length and ratio of length to breadth of the grain shall be more than 3.6;</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Exports to Russian Federation permitted subject to pre-shipment quality certification issued by Sri Ram Institute for Industrial Research or any other agency as may be notified from time to time.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Export permitted only if the minimum FOB price is US$ 1200 per ton or Rs. 48,000/- per ton.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Export of Basmati Rice will be restricted through the following six ports only: (i) Kandla, (ii) Kakinada, (iii) Kolkata, (iv) JNPT, Mumbai, (v) Mundra, and (vi) Pipavav</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Do they have equipments to measure the length and breadth of rice in the Customs?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Why do they make laws which are difficult to implement? Imagine this. Rice exported is confiscated as the grain size is not of prescribed length 7 mm and length breadth ratio is less than 4. The Commissioner confirms the confiscation. Matter goes to the Tribunal. Imagine the following findings:</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The appellant exporter submitted that Rice is agricultural produce and he has no control over the size of the grain. One cannot expect that all rice grains should be of uniform length and maintain length breadth ratio prescribed as it is grown naturally. The samples taken by the department may fail the test, but majority of the rice in the consignment conforms to the standards. We find force in the submissions of the exporter. Revenue has not adduced any evidence that the rice grains in the entire consignment do not conform to the standards prescribed. As rightly argued, the exporter has no control over the size of grains of rice which is grown naturally. Confiscation set aside and appeal allowed, with consequential benefits, if any.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2008/dgft08not039.htm" target="_blank">DGFT Notification No. 39 (RE-2008)/2004-2009 Dated: September 16, 2008</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Export of Non Basmati Rice, Maize and wheat – DGFT amends policy</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Non Basmati Rice (seed quality); Maize (corn) Seed quality; Durum Wheat: of seed quality- Wheat of seed quality; Meslin of seed quality:</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Export will be allowed subject to submission of following documents to Customs at the time of export:</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) A license to carry on the business of a dealer in seeds issued under Section 3 of the Seed Control Order (1983) from the State Government; and</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Declaration that the export consignment of seeds has been chemically treated and is not fit for human consumption; and</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Export packets will be labelled that seeds are treated with chemical insecticides and cannot be used for food or feed purposes.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2008/dgft08not040.htm" target="_blank">DGFT Notification No. 40 (RE-2008)/2004-2009 Dated: September 17, 2008</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax – Dispute Resolution Scheme covers even cases adjudicated after 1.3.2008 – Board clarifies</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CBEC, in a clarification issued to the Surat Commissioner (with copies to the DGST and all other Commissioners) has clarified that,<font color="#FF6633"> “The Dispute Resolution Scheme, 2008 covers a case where show cause notice was issued on or before 1.3.2008 and the service tax arrears (pending service tax amount), as on 1.3.2008, in respect of such case was up to Rs. 25,000, irrespective of the fact that such SCN may have been adjudicated after 1.3.2008. The Dispute Resolution Scheme would be applied to a particular case with respect to its pending position as on 1.3.2008.”</font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2008/137_letter.htm" target="_blank">CBEC F.No. 137/96/2008- CX.4 Dated: September 02, 2008</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax – Dispute Resolution Scheme covers revision orders passed by Commissioners – CBEC clarifies</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CBEC, in a clarification issued to the Coimbatore Chief Commissioner (with copies to the DGST and all other Commissioners) has clarified that,</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Revisional orders issued under section 84, qualify as orders issued under the provisions of Chapter V of the Finance Act, 1994, the Scheme applies to such orders, subject to satisfaction of other conditions . Further, the affect of a revisional order passed by the Commissioner is that it only revises the order passed earlier by lower authority; therefore, if the revisional order has been issued on or before 1.3.2008, the compounding amount would be determined on the basis of the revisional order passed under section 84.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) As regards a notice issued under section 84, giving the assessee an opportunity to be heard and present his case, such a notice does not alter the position of tax arrears, hence such notice does not have any relevance in so far as application of the Scheme is concerned. Therefore, such notice has not to be taken into account for computation of compounding amount under the Scheme. However, in respect of cases where assessee opts for the Scheme, any pending proceeding under section 84 would stand finalized.</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Hardly ten days are left before the Scheme closes and still the field officers have several doubts, to mention just one, “does the scheme cover non filers?”</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2008/137_letter_II.htm" target="_blank">CBEC F.No. 137/96/2008- CX.4 Dated: September 02, 2008</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Promoted Assistant Commissioners – exercise your option by tomorrow</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Last week the CBEC promoted 160 Superintendents of Central Excise/Customs etc,. To the rank of Assistant Commissioner and they were not given any posting order.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The promoted officers were asked to send five places of their choice for a possible posting, by 17.9.2008. But it seems the Board has not received options from a large number of officers – maybe they are not aware that options are to be given. Anyway the gracious Board has extended the time by another two days – they want the representations by tomorrow.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=70&filename=pitara/sernews/order/letter_ADII.htm" target="_blank">CBEC's File No. A-32012/28/2007-Ad-II</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>India welcomes Multi Facility Economic Zone for Indian companies in Zambia</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Union Minister of Commerce & Industry, Kamal Nath has welcomed the Multi Facility Economic Zone created by the Zambia Development Agency for Indian Companies to set up manufacturing and services industries in Zambia. During the bilateral meeting with Felix C. Mutati , Minister for Trade, Commerce and Industry, Zambia, Kamal Nath stated that India has lot to offer for infrastructural development in Zambia, particularly in energy, mining, agriculture, commercial building and road transportation sectors. He further added that India would like to explore and invest in the development of industries-based crops such as cotton, sugar, soya bean and groundnuts. Both sides agreed for cooperation for capacity building in the field of agro-processing and development of agro product markets.</font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Jurispruden</font><font color="#FF6633" size="5">tiol</font><font color="#006600">– Tomorrow's cases</font></strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><strong><strong><strong><strong><strong><b><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_hammer.jpg" alt="Legal Corner Icon" width="100" height="84" hspace="5" border="0" align="left"></b></strong></strong></strong></strong></strong></strong></strong></font>Income Tax</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Incentive subsidy received by Sugar Mills was Capital Receipt and not Revenue Receipt – Supreme Court</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> test is that the character of the receipt in the hands of the assessee has to be determined with respect to the purpose for which the subsidy is given. In other words, in such cases, one has to apply the purpose test. The point of time at which the subsidy is paid is not relevant. The source is immaterial. The form of subsidy is immaterial. The main eligibility condition in the scheme in this case is that the incentive must be utilized for repayment of loans taken by the assessee to set up new units or for substantial expansion of existing units. On this aspect there is no dispute. If the object of the subsidy scheme was to enable the assessee to run the business more profitably then the receipt is on revenue account. On the other hand, if the object of the assistance under the subsidy scheme was to enable the assessee to set up a new unit or to expand the existing unit then the receipt of the subsidy was on capital account. Therefore, it is the object for which the subsidy/assistance is given which determines the nature of the incentive subsidy. The form of the mechanism through which the subsidy is given is irrelevant.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tour operators using vehicles as stage carriages – still liable to pay Service tax as tour operator – since Government has issued Section 11C notification, no suppression can be alleged and no extended period can be invoked - CESTAT</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SINCE</strong> the Government itself in this notification has acknowledged the practice of non-levy of service tax during period from 1.4.2000 to 4.2.2004 on the service provided by tour operators operating under Contract Carriage permits, in relation to transport of passengers from one place to another (other than package tour services) there will be no justification for holding the Appellant guilty of wilful suppression of relevant information with intent to evade the service tax. So, longer limitation period cannot be invoked and the entire demand is time barred.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Central Excise</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Valuation of Sec 4A notified goods - paints manufactured on job work - 200 litre bulk drums correctly assessed u/s 4 on basis of formula laid down in Ujagar Prints case - Tribunal allows appeal.</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> product manufactured and packed in 200 Ltr drums are not covered under the provisions of Section 4A and if that be so, the appellant is free to apply the provisions of Section 4 for the purpose of arriving at the correct assessable value of the said goods.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our columns Tomorrow for the judgements</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Day.</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <a href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com</a></font></p>
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